Japan's domestic carbon steel sales dip for 11th month in July

For July, Japan's domestic carbon steel sales had declined for the 11th month by 11.1% on year to about 2.95 million tonnes, or marking the third month to stay below 3 million tonnes, according to the data released by Japan Iron & Steel Federation (JISF) on September 16. A JISF official commented that slower steel demand from manufacturers had continued.

Japan's July domestic carbon steel sales were also down 0.7% on month, and the total volume over January-July approximated 21.34 million tonnes, down 5.3% on year, the JISF data showed.

The JISF official shared that he heard Japanese manufacturers including automakers had started lifting operations from July, but their steel consumption was still lower than usual. "We expected that steel orders might start increasing moderately in coming months," he predicted.

A construction steel trader shared that steel consumption in Japan's construction sector had been active amid increasing demand for storage and ongoing large-scale construction projects, though firm demand didn't translate to steel orders in July.

"We believed that it was because buyers had already secured sufficient construction steel products such as H-beams and bars by May over the anticipation of price rise when producers were active to lift prices," he said.

"And buyers had been held back in July when scrap prices were weakening, which led actual bookings of construction steel to decline in the month," he added.

As for exports, Japan's carbon steel exports declined by 13.7% on year and 0.5% on month to 1.64 million tonnes.

A Tokyo-based steel trader explained that Japan's integrated mills were not active in exporting because overseas market prices had been softening, and August exports were also slower due to the same reason.

By product, exports of hot-rolled coil (HRC), Japan's largest production item totaled 1.39 million tonnes, down 16.7% on year and 4.5% lower on month, while those of plates, the country's second-largest production item were at 795,313 tonnes, up 7.2% on year but down 0.7% on month.

The steel trader observed that Japanese HRC producers had trimmed output to adjust their stocks lower, and sales of HRC as the country's key exporting item had also declined. "Plate demand from shipbuilders has been firm, and we expect plate sales to stay at a high level for coming months," he predicted.

Written by Yoko Manabe, yoko.manabe@mysteel.com
Edited by Zhenqi Yang, yangzhenqi@mysteel.com
This article has been published under an article exchange agreement between Mysteel Global and SteelMint.